An official website of the U.S. GovIRC § 7803(c)(2)(B)(ii)(III) requires the National Taxpayer Advocate to prepare an Annual Report to Congress that contains a summary of the ten most serious problems encountered by taxpayers each year. For 2025, the National Taxpayer Advocate has identified, analyzed, and offered recommendations to assist the IRS and Congress in resolving ten such problems
Refund Delays and Unclear and Confusing Disallowance Notices Harm Taxpayers and Jeopardize Their Rights to Administrative and Judicial Review
Taxpayers are harmed by the IRS’s delays in processing amended returns, the issuance of confusing or incomplete notices of claim disallowance, and the absence of clear, accessible procedures for extending the statutory period during which the IRS must issue refunds. Together, these failures impose significant financial hardship, jeopardize taxpayer rights, put taxpayers at risk of losing their refunds, and undermine confidence in tax administration.
Outdated Paper Processes and Procurement Delays Harm Taxpayers
When returns, amended filings, or correspondence must be processed on paper, resolution and processing times slow dramatically. Taxpayers bear the cost through delayed refunds, prolonged disputes, and months of anxiety and uncertainty about their financial standing. Procurement and modernization delays have compounded this problem, preventing the timely deployment of digital tools that could dramatically reduce backlogs and improve accuracy.
The IRS Does Not Accurately Measure the Quality of Telephone Service
Taxpayers calling the IRS are often seeking help with urgent and stressful issues. For many taxpayers, particularly those without reliable internet access or the ability to access or navigate online tools, calling the IRS is the most direct and sometimes only way to resolve these problems. When the IRS fails to provide quality telephone service, taxpayers suffer real and measurable harm.
Taxpayers and Tax Professionals Continue to Raise Concerns About Independence, Undermining Public Confidence in the Appeals Process
Extended delays before a case reaches an Appeals Officer, inconsistent case handling, limited transparency, and perceptions that decisions are being driven by IRS compliance functions instead of applying the hazards of litigation to the facts and law deny taxpayers timely and impartial consideration. These deficiencies create prolonged uncertainty, higher costs, and diminished confidence that the system is fair.
Online Accounts for Tax Professionals Lack Critical Functionality Required to Effectively Represent Taxpayers
Many taxpayers who receive an IRS notice, face an audit, or are subject to collection action rely on tax professionals to understand what the IRS is asking, respond accurately and on time, and protect them from unnecessary penalties, interest, and enforcement actions. For these taxpayers, effective representation is often the difference between timely resolution and prolonged financial distress. The IRS’s digital tools for representatives fall far short of what is needed. The lack of a fully functional digital platform creates unnecessary obstacles in exercising the taxpayer right to retain representation.
Taxpayers Face Delays and Inadequate Responses to Their Administrative Requests for Records From the IRS
Taxpayers and their representatives often struggle to obtain records from the IRS that they need to advocate for their positions and understand the agency’s rationale for its decisions. This lack of access leads to unnecessary frustration, repeated calls and correspondence with the IRS. As a result, taxpayers may submit multiple requests to different IRS employees and under the Freedom of Information Act, which, in turn, may exacerbate backlogs and delays in producing documents. For time-sensitive information, taxpayers may not receive it before statutory or procedural deadlines expire, depriving them of their rights to be informed and to a fair and just tax system.
Systemic Failures Undermine Taxpayer Rights to Representation, Due Process, and Quality Service
For many taxpayers, authorizing a qualified representative is essential to navigating the IRS. Taxpayers facing audits, collection actions, identity theft, or financial hardship often rely on tax professionals to interpret notices, communicate with the IRS, and protect their rights. The IRS’s Centralized Authorization File (CAF) is the mechanism that enables this representation by recording powers of attorney and tax information authorizations. When the CAF process breaks down, taxpayers are the ones who bear the consequences.
The Negative Tax Influence of Social Media Harms Taxpayers
Social media has fundamentally changed how taxpayers obtain and consume information about their tax obligations, benefits, and rights. Guidance once sought from trusted professionals and official IRS sources is now increasingly offered by online influencers, typically without proper context, verification, or accountability. Social media harbors risks that often exploit tax complexity and limited tax literacy. As social media continues to shape taxpayer behavior at scale, its growing influence poses a direct and urgent threat to taxpayer rights, fairness in tax administration, and confidence in the tax system itself.
U.S. Taxpayers Living Abroad Face Severe Compliance Burdens
U.S. taxpayers living abroad face significant and often overwhelming challenges in complying with their federal tax obligations. Although they live and work under foreign legal, financial, and tax systems, they remain subject to the full scope of U.S. tax laws. As a result, they must navigate not only the complex U.S. tax code but also extensive and confusing international information reporting requirements. The interaction between U.S. tax laws and the tax systems of their countries of residence compounds the complexity. Harsh and disproportionate penalties that may apply even when taxpayers make good-faith mistakes or owe no U.S. tax intensify these burdens.
Taxpayers Face Long Delays and Hardships With IRS Processes Designed to Offer Relief From International Withholding Requirements
The U.S. tax system requires upfront withholding on certain payments to foreign taxpayers. In some situations, the required withholding amounts far exceed the taxpayer’s actual tax liability. The IRS provides processes through which taxpayers can apply to reduce or eliminate this withholding, but some of these programs suffer from extensive delays and lack effective methods for taxpayers to contact IRS employees to get help with problems. U.S. withholding requirements affect both foreign and U.S. taxpayers. People in the United States who make payments to foreign taxpayers may be unaware that they are subject to withholding requirements and can face personal liability not only for failing to withhold but also for associated penalties and interest.
